80 FR 57026 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees Schedule

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 182 (September 21, 2015)

[Federal Register Volume 80, Number 182 (Monday, September 21, 2015)]
[Notices]
[Pages 57026-57027]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-23527]



[[Page 57026]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75923; File No. SR-CBOE-2015-075]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend the Fees Schedule

September 15, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on September 2, 2015, Chicago Board Options Exchange, Incorporated 
(``Exchange'' or ``CBOE'') filed with the Securities and Exchange 
Commission (``Commission'') the proposed rule change as described in 
Items I and II below, which Items have been prepared by the Exchange. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Fees Schedule. The text of the 
proposed rule change is available on the Exchange's Web site (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's 
Office of the Secretary, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the Fees Schedule. Specifically, the 
Exchange proposes to make changes to the Facility Fees section of the 
Fees Schedule and in particular, the Notes section associated with the 
Floor Broker Workstation (``FBW'') and Floor Broker Workstation 2 
(``FBW2'') line-items. Pursuant to that section, the Exchange charges a 
Trading Permit Holder (``TPH'') a monthly fee of $400.00 per login ID 
per month for the use of a FBW or FBW2.\3\ Pursuant to the Fees 
Schedule, the Exchange assesses these facility fees in arrears during 
the first week of the following month. For example, a TPH will be 
billed in February for use of an FBW or FBW2 in January. Monthly fees 
are assessed and applied in their entirety and are not prorated.\4\ 
Consequently, a TPH that cancels an FBW or FBW2 login ID on January 3 
will still be charged the $400.00 fee for all of January on the 
February bill.
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    \3\ FBW and FBW2 are order management tools used by Floor 
Brokers to handle orders on the floor of the Exchange. FBW is a 
third-party facility of the Exchange. As provided in the Notes 
section of the FBW2 line-item, for every FBW login a TPH has, the 
FBW2 fee will be waived on a one-to-one basis for the months of July 
2015 through September 2015.
    \4\ See Fees Schedule, footnote 28.
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    The Exchange proposes to make changes to the Facility Fees section 
of the Fees Schedule in the Notes of the FBW and FBW2 line-items to add 
that FBW and FBW2 login IDs will be renewed automatically for the next 
month unless the TPH submits written notification to the Market 
Operations Department by 3:00 p.m. CT on the second-to-last business 
day of the prior month.\5\ This change would be effective immediately 
and apply to FBW and FBW2 cancellations beginning September 1, 2015.\6\
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    \5\ The proposed new language would read FBW and FBW2 ``login 
IDs will be renewed automatically for the next month unless the TPH 
submits written notification to the Market Operations Department by 
3:00 p.m. CT on the second-to-last business day of the prior month 
to cancel the FBW or FBW2 login ID at or prior to the end of the 
applicable month.''
    \6\ Effective September 1, 2015, FBW and FBW2 login IDs will be 
renewed automatically for the next month unless the Trading Permit 
Holder (TPH) submits written notification to the Market Operations 
Department by 3:00 p.m. (CT) on the second-to-last business day of 
the prior month. Requests for cancellation of logins for the FBW and 
FBW2 must be specified on the Exchange's new FBW Login Cancellation 
Form, which is being adopted concurrently with this filing and can 
be found at https://www.cboe.org/members/generalinfo/memberforms.aspx and emailed to [email protected] by 3:00 p.m. (CT) 
two business days prior to the intended inactivation date. Please 
note that in addition to specifying whether the cancellation will 
apply to an FBW (legacy) login or FBW2, FBW and FBW2 users will be 
asked to specify whether the risk limits associated with the 
particular FBW or FBW2 login should be suspended as well. A copy of 
the new Floor Broker Workstation (FBW) Login Cancellation Form is 
attached as Exhibit 3 to this filing.
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    Currently, the Fees Schedule makes clear that monthly fees are 
assessed and applied in their entirety and not prorated, but gives no 
time or day by which such cancellation must be received by the 
Exchange. Accordingly, so long as a work request is received before the 
end of the last second of the day before the end of the month, a TPH 
may cancel an FBW or FBW2 login ID for that month.\7\ As a third-party 
facility of the Exchange, however, cancellation requests received at 
the eleventh hour of the last day of the month cannot always be 
processed easily in time. Without ample time to decommission these 
logins, the Exchange is more susceptible to configuration and 
unauthorized access issues. The Exchange proposes this change to ensure 
that there is ample time for the Exchange to process such requests 
prior to the end of the month and ensure that cancellations are 
completed before the end of the month for which the TPH will be billed.
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    \7\ FBW is being decommissioned on October 31, 2015.
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2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\8\ Specifically, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) \9\ requirements that the rules of 
an exchange be designed to prevent fraudulent and manipulative acts and 
practices, to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in regulating, 
clearing, settling, processing information with respect to, and 
facilitating transactions in securities, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general, to protect investors and the public interest. 
Additionally, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) \10\ requirement that the rules of 
an exchange not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
    \10\ Id.
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    In particular, the Exchange believes that the proposal to require 
that FBW and FBW2 login IDs will be renewed automatically for the next 
month unless the TPH submits written notification to the Market 
Operations Department by 3:00 p.m. CT on the second-to-last business 
day of the prior month to

[[Page 57027]]

cancel the FBW or FBW2 login ID effective at or prior to the end of the 
applicable month is equitable and not unfairly discriminatory as it 
applies to all TPHs that have an FBW or FBW2 login ID and wish to 
cancel an FBW or FBW2 login ID effective prior to the end of a month. 
The Exchange believes the proposed rule change protects investors and 
the public interest by helping the Exchange to more easily ensure that 
configuration and unauthorized access issues are averted. The Exchange 
believes that the proposed rule change is fair and reasonable because 
it only requires that TPHs have the aforethought to know how many login 
IDs they will need for the next month two business days prior to the 
end of each month and inform the Exchange at that time.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. The Exchange does not 
believe that the proposed rule changes will impose any burden on 
intramarket competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because the proposed changes 
apply to all FBW and FBW2 users. Moreover, the Exchange does not 
believe that the $400.00 monthly charge that would apply to FBW and FBW 
[sic] users that do not submit written notification to the Market 
Operations Department by 3:00 p.m. CT on the second-to-last business 
day of the prior month to cancel the FBW or FBW2 login ID effective at 
or prior to the end of the applicable month is of a nature that is 
large enough to discourage the use of FBW or FBW2 or which would impose 
a burden on competition. The Exchange does not believe that the 
proposed rule changes will impose any burden on intermarket competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Act because these changes apply to billing and fees that affect 
CBOE only, not other exchanges. Further, to the extent that the 
proposed changes ensure that configuration issues do not occur or 
affect Floor Brokers on the Exchange, such market participants may be 
more likely to operate on the Exchange.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange neither solicited nor received written comments on the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \11\ and paragraph (f) of Rule 19b-4 \12\ 
thereunder. At any time within 60 days of the filing of the proposed 
rule change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-CBOE-2015-075 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-CBOE-2015-075. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549 on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-CBOE-2015-075 and should be 
submitted on or before October 13, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-23527 Filed 9-18-15; 8:45 am]
 BILLING CODE 8011-01-P